GCC Indirect Tax Digest

1

Supply of goods and/or services; or movement of goods - from the Oman mainland to a Special Zone or within the Special Zone

• Taxable at zero percent (0%) and meeting of the conditions mentioned in the Executive Regulations 

Note: the customer located in the Special Zone must sign a statement, which confirms it is licensed to operate in the Special Zone and that the goods are for the purpose of carrying out that licensed activity in the Special Zone and provide this to the Supplier. The Supplier shall not apply the zero rate if he does not hold such a statement

• Taxable at zero percent (0%) and meeting conditions
  mentioned in the VAT Executive Regulations
• If VAT is charged and the recipient is VAT registered, VAT paid can be deducted (as input tax) according
  to normal deduction rules

2

Supply of goods and/or services; or movement of goods - from a Special Zone to Oman
mainland

• To be considered as import and import VAT to be payable by the importer while moving goods for free circulation within the Oman mainland
• The import VAT shall be due on the date of release of goods from the Special Zone
  

Taxable at standard rate of 5%, unless such services are exempted or zero-rated as per the VAT Law and Executive Regulations

3

Import of goods and/or services - from outside Oman into a Special Zone

• To be considered as import; however, import VAT would be suspended on entry of goods into the Special Zone until release or at any other time when the suspension period ends under Common Customs Law

Note: The importer would have to submit a guarantee to the Directorate General of Customs equal to the value of the VAT due and such guarantee must be valid throughout the period of tax suspension. This guarantee can be in form of a (i) bank guarantee, or (ii) financial guarantee, or (iii) written guarantee, or (iv) any other type determined by the Directorate General of Customs

• Taxable at zero percent (0%), subject to fulfillment of the conditions in the VAT Executive Regulations
• In other cases, taxable at the standard rate of 5%, unless such services are exempted as per the VAT Law and Regulations. The recipient of services to account for VAT under Reverse Charge Mechanism

4

Supply of goods
and/or services; or movement of goods - from a Special Zone to outside Oman

• To be treated similar to export of goods, subject to the conditions laid out in the VAT Executive Regulations

Note: we understand that
transactions with businesses in other Gulf Co-operation Council or GCC member states are treated the same as those in non-GCC countries 

• Taxable
  at zero percent (0%) rate, subject to fulfilment of the conditions of export of services mentioned in the VAT Law and the Executive Regulations

5

Transfer of goods or
supply of services from the Special Zone to one of the Customs Duty Suspension
Statuses

• To be considered as zero-rated supplies as long as the taxable person who transfers the goods must maintain documentary evidence, proving that the transfer of goods is done after obtaining approval by the Operating and Regulating Authority of the Special Zone or the Directorate General of Customs (as the case may be)
  

• Taxable at zero percent (0%) rate, subject to meeting conditions for zero-rating per the VAT Law and Regulations
  

6

Supply of goods
and/or services from the Customs Duty Suspension Statuses to a Special Zone

• To be considered as zero-rated supplies if meeting the conditions stipulated in the VAT Executive Regulations 
  

• Taxable at zero percent (0%) rate subject to the conditions in the VAT Law and the Executive Regulations